Monday, November 22, 2010

Starving Transit?

CATCH News – November 22, 2010

Bus improvements and fare hikes on agenda

The new council will grapple with possible bus fare hikes and route changes before the end of the year. Fares were raised last January, but not as much as recommended by staff, and a provision of more monies to the HSR for service improvements is also up for debate.

The new council takes office on December 1 in a strictly ceremonial inaugural meeting, but will be asked to make several key decisions before Christmas – including raising water and sewer rates and other fees, and finalizing the transit budget before discussing other aspects of next year’s budget. The rush to raise fees is intended to ensure these can be collected as early as possible in 2011.

The transit budget is scheduled for debate on the morning of Tuesday, December 14, but actual proposals from staff won’t be made public before December 10. Ridership this year was higher than expected and bus repair costs were lower, but those revenue gains have already been shifted to reserves – leaving the overall 2010 budget at “a net zero position”.

HSR cash fares have climbed more than 20 percent since June 2007, while the price of adult monthly passes has jumped by a third and school-age passes have gone up 40 percent (see table below). But rising fuel prices and regular wage increases of transit employees could be used to argue for another fare hike for 2011.

Last year’s recommended increase was 20 cents a ride, but some councillors wanted less and a 15 cent increase was eventually adopted by a narrow 9-7 vote. Three of those who voted in favour aren’t part of the new council – Fred Eisenberger, Margaret McCarthy and Dave Mitchell – all of whom supported the 20 cent hike.

The seniors’ annual pass was left at the $205 level it’s been fixed at since 2003, but adult and student passes each climbed $8 a month to $87 and $71 respectively. That translated into $96 more per year for each regular rider – and much more for those with several family members using the transit system.
Council refused to consider the alternative of raising taxes to cover increased HSR expenditures. It also ignored commentary in the staff report that suggested that might be the best option:

“Ideally, transit program managers recommend fare increases to generate new revenue to fund service level increases stipulated in corporate strategic objectives,” stated the report. “Less desirably, in a challenged fiscal environment, fare increases are applied to meet fiscal goals for program budgets versus strategic goals. Finally, fare increases where the new revenue is used to offset increases to the general tax levy are detrimental to the sustainability of transit programs.”

In its final resolution, council directed staff to come up with a policy for automatically raising fares without a council debate, but that hasn’t happened yet. A second issue facing councillors is a proposal to use federal gas tax monies for transit.

The city receives $32 million a year in these payments, but so far has used none of it for bus services. Brian McHattie has been advocating that $3 million of that money be shifted to the HSR to pay for more bus service.

In August, council decided to put off that re-allocation to the 2011 transit budget, so that proposal will also be up for decision on December 14. Some councillors suggested this amount is “pie in the sky”, but it was strongly defended by transit director Don Hull who said the system really needs ten times that amount.

“$30 million is just what it would take over the next five years to keep moving towards the Transportation Master Plan,” he explained. “The $3 million that we’re asking for in alternative to the $30 million is simply what we feel we need in the very short term to prevent the public satisfaction with this program from deteriorating.”

Hamilton is one of only two municipalities that currently use none of their federal gas tax for transit. The other is Durham Region which plans to spend its entire share on a new incinerator. Hull’s August report indicated the extra monies could fund weekend service on the King, Stone Church and the B-Line routes and weekday expansion on the Delaware, Upper Kenilworth, Rymal, Locke, York and Aberdeen lines.